How to Open a Bank Account in Canada – The Ultimate Guide-We all know how complicated opening a bank account in Canada can be. There are so many rules and regulations, it’s overwhelming. To help you out, we’ve put together this helpful guide to help you open your first Canadian bank account with ease!
What do you need to open a bank account in Canada?
To open a bank account in Canada, you must have the proper documentation and meet the bank’s requirements. There are no residency requirements for opening a business bank account in Canada.
- You will need to provide proof of ID for the business owner, as well as documents related to ownership of the business.
- You need to have a valid passport and residency card
- Documents must be authenticated
- You will need proof of income or assets
- There may be fees for account opening
Which are the most popular banks in Canada?
There are five major banks in Canada: Royal Bank of Canada (RBC), Toronto-Dominion Bank (TD Bank), Scotiabank, Bank of Montreal (BMO) and Canadian Imperial Bank of Commerce (CIBC).
Depending on your needs and reason for wanting a bank account in Canada, both the bank and types of accounts available to you can vary. Before applying for an account, you need to ask yourself questions about fees, deposits, services offered and other limiting factors.
Canadian Bank Account Types
The majority of bank accounts in Canada are chequing or savings accounts. Chequing accounts operate similarly to current accounts in other countries and include the following services:
- Access to online banking;
- Payment of bills and other obligations;
- Transfers of funds;
- Transfers of funds and direct debits;
- Regular payments;
- Cards de débit;
- Withdrawals from ATMs.
Savings accounts enable you to accumulate funds over time and pay interest on those funds. Frequently, there are limitations on how frequently you may take funds from a savings account.
Both checking and savings accounts will give you the following benefits:
- A routing number that identifies your financial institution;
- A unique identifier for your account.
How to Open a Bank Account in Canada
Bank accounts in Canada are available to non-residents, expats, and residents. Identification requirements vary depending on the bank, but most require a valid ID such as a driver’s license or passport.
Some banks offer online account opening services which are generally easy to use. Bank products (investment products, for example) are not limited to Canadian residents only.
Types of online banks include savings, high-interest savings, checking, Tax-Free Savings Account (TFSA), hybrid, youth, and senior accounts.
Bank fees in Canada range anywhere between 4 CAD (3 USD) to 30 CAD (23 USD) per month. While no minimum deposit is needed at most banks to open an account, there is a minimum monthly balance that banks require you to keep if you want your monthly fees waived. This amount is usually somewhere in the range of 3,500 CAD (2,634 USD).
Bank fees can include monthly checking account fees, ATM fees, transfer fees, foreign transaction fees, chequebook fees, fees for debit transactions over the monthly limit (usually 1 CAD (less than 1 USD) per transaction), stop payment fees, Non-Sufficient Funds (NSF) fees, overdraft fees, paper statement fees, check certification fees, and plenty more.
No-fee bank accounts in Canada are available for youth, students, seniors getting the Guaranteed Income Supplement (GIS), and Registered Disability Savings Plan (RDSP) beneficiaries.
Where is the best place to start a bank account?
At financial institutions, you can open a chequing or various forms of savings accounts, such as a:
- credit union
- caisse populaire
- trust company
Do you need a Canadian bank account to work in Canada?
You don’t need a Canadian bank account to work in Canada, but most employers prefer you to have one. You can pay your taxes and make payments to the Canada Revenue Agency by wire transfer or with an internationally issued credit card, through a third-party service like WorldRemit. If you’re a U.S. resident who wants to work and study north of the border, it’s worth knowing how to open a bank account before you relocate to Canada.
Can a foreigner open a bank account in Canada?
In Canada, you have the right to open a bank account, even if you don’t have a job or money. You need to provide proper documentation and be prepared for the challenges you may face when opening an account. It’s possible to open an account without visiting Canada in some special cases.